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Oslo Børs established ABM in June 2005 as an alternative to the ordinary stock exchange bond market. Its objective was to give market participants the opportunity to list loans using a somewhat simpler application process for admission to listing than for the stock exchange bond market, but with the same requirements on providing information save for the requirement to produce IFRS accounts.
All the loans so far admitted to listing on ABM have been new loans, but Oslo Børs expects that a number of the loans currently listed on the ordinary stock exchange bond market will transfer to the ABM during the second half of this year as a result of the requirement for issuers to produce consolidated accounts in accordance with IFRS with effect from the 2007 accounting year.
The simpler and quicker process for admission to listing is one of the major reasons for the strong interest shown in ABM listing, but many issuers also point out how positive it is that ABM imposes the same duties on information disclosure as the stock exchange market since this is important both for confidence in issuers and for investment decisions.
The 100th loan admitted to ABM on Wednesday 21 June was a bond loan issued by Sandsvær Sparebank. The 100 loans listed are issued by 67 different borrowers, and 29 of these joined the new market in 2006. Banks and other financial institutions account for 87% of the loans listed on ABM, and industrial companies account for a further 10%. Foreign issuers account for 1% of the total.
More information on ABM can be found at www.abmportal.no
Record number of loans listed through Oslo Børs
As of today, 910 loans are listed through Oslo Børs, of which 105 are ABM listings. This is the highest number of loans listed through Oslo Børs since the legal requirement for all bond loans to be stock exchange listed ended on 31 December 1996.
The Norwegian bond market is principally made up of professional investors. At the close of 2005, private individuals held just under 4% of the securities outstanding. The predominance of professional investors is a relatively significant factor in the general approach to the requirements and expectations placed on borrowers in this market, both in terms of the information provided for new issues and the flow of information during the life of a loan.
The issuers in the market are widely diversified in terms of both the sectors they represent and their size. Oslo Børs believes that this is a particular strength of the Norwegian bond market since it enhances the choices available to investors to achieve their preferred investment position.
